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House Tax Committee Approves Making Ports Tax Break Permanent

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RALEIGH — A tax break enjoyed by wood chip millsshipping their products through state ports would end under a billthat also makes the credit permanent for other shippers.

The House tax-writing committee approved the measure Thursdayand sent it to the budget-writing committee. The tax breaks aredesigned to help the state ports at Wilmington and Morehead Citycompete with nearby harbors at Charleston, S.C., and Norfolk, Va.

Environmental groups have long opposed chipping mills becausethey say the mills encourage loggers to clear-cut forests.

The deleted tax break for shipping wood chips will not effecthow much is produced for export through the ports, a spokesman fora logging industry trade group said. Chip mills could continueexporting through the state ports or shift to nearby competitors,said Robert Slocum, the executive vice president of the NorthCarolina Forestry Association.

Shippers can deduct up to 50 percent of what they pay the StatePorts Authority for storage and handling costs, up to $2 million,from their yearly state income taxes.

The state ports supported 80,000 jobs statewide and generatednearly $300 million in tax revenue in 1999, the latest year forwhich there are state estimates.

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